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Time limit to open offers in assessment proceedings

A reader of the Legal Costs Blog recently asked the question whether an open offer pursuant to PD 47 paragraph 8.3 can be made with a time limit for acceptance.

The wording of the PD simply says:

“The paying party must state in an open letter accompanying the points of dispute what sum, if any, that party offers to pay in settlement of the total costs claimed. The paying party may also make an offer under Part 36.”

I therefore see no reason why such an offer cannot have a time limit for acceptance imposed on it. Obviously, if the time limit is deemed to have been unreasonably short then the offer is unlikely to offer any protection (to the extent to which open offers do provide protection).

Further, as there are no special rules governing 8.3 offers (unlike Part 36 offers) it appears that ordinary contract law applies. An offer that is rejected, whether expressly or by conduct (serving Replies?), will no longer be open for acceptance. Equally, a counter-offer will also amount to rejection and mean the original offer is no longer open for acceptance.

7 thoughts on “Time limit to open offers in assessment proceedings”

Agreed – no time limit is required. However, am I missing something or are the rules on offers a bit mad?

As I understand it (which is possibly not very well) paying parties have to make an offer in an open letter (ie one the Costs Judge will see before assessing the bill) and the receiving party includes this in the bundle to be lodged at court. The receiving party also separately lodges offers that are made under Part 36 and “without prejudice save as to costs” in a sealed envelope.

Why do judges get to see paying parties’ offers before the assessment? Why must open offers be made when it is clearly envisaged that parties will also make offers that are not considered until after the assesment has taken place?

Surely it should be either one or the other; either both parties make offers the Judge can see (although this would be a major departure from the previous status quo) or both parties make offers that are in a sealed envelope until the end of the hearing?

Lodging the open offer with the points of dispute is the next logical step. It was always a faff trying to work out what alternative sums were being offered in the PODs, particularly when there were numerous points of principle being relied upon.

As least with an open offer and simplified PODs,it is clear to the receiving party what is being offered which might speed settlement along without the involvement of the court.

In the event that assessment is required, there is no harm in the judge seeing what is being offered within a letter rather than have to consider the PODs and work out what is being offered him/herself. This will cut down work drastically on a provisional assessment.

Is there anything to stop the receiving party making an open offer to settle and include that in the bundle for assessment? This would put the parties on a level footing.

Where does it say that you show the judges open offers pre-assessment?

The only offers you lodge are the “Part 36 or Similar Offers” and those are sealed. The Defendant’s 8.3 offer is contained in a covering letter to the Points of Dispute, which you wouldn’t file with the court.